Steep decline in directories business

Telstra
has refused to call time on the print version of its Yellow Pages telephone directory despite a horror performance in the first half of the financial year.

Revenue from its Sensis advertising and directories division plummeted to $793 million in the six months ended December 31, 2010. This was a drop of $182 million or 18.7 per cent, from the previous corresponding period.

Telstra chief financial officer
John Stanhope
said the fall had been exaggerated because revenue from the Sydney edition had not been counted due to delays in distributing the directory in Australia’s largest city. He estimated Sydney revenue at about $83 million, which would mean Sensis sales revenue was down by a less drastic 7.9 per cent.

Sensis chief executive
Bruce Ackhurst
will brief investors on the future of the business during the next couple of weeks. He is expected to provide further details on its digital strategy as consumers increasingly shift to online and mobile searches.

Although the dire performance was second only to the $253 million drop in fixed-line phone revenue, Telstra chief executive
David Thodey
refused to admit that the print version of Yellow Pages was in terminal decline.

“We have always known that print will decline and digital is going to grow," he said. “That’s been a trend in the market for a number of years.

“This is a transition that will continue. I don’t see the death of print, I just think we will have print and digital together but digital will be very strong."

Mr Thodey said digital sales growth had been good in the first half although revenue was slightly below expectations.